What Is A Year Of Human Life Worth? Updating The Renal Dialysis Cost-Effectiveness Standard

Main Category: Urology / Nephrology
Article Date: 30 Jul 2008 - 3:00 PDT

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A quality-adjusted year of human life is worth $129,090, according to a study to appear in Value in Health.

Chris Lee of The Wharton School of the University of Pennsylvania and Glenn Chertow and Stefanos Zenios of Stanford University sought to find the worth of a year of human life, a figure which can be used to inform decisions such as the determination of compensation when life is lost to accidents or mishaps, the pricing and coverage of medical procedures and the pursuit of expensive but life-saving public programs.

Within the medical establishment, the cost-effectiveness of ratio of renal dialysis has been widely used as a proxy for the worth of a year of human life ever since Medicare made a landmark decision in the 1970s to cover dialysis for anyone who needed it regardless of age, a move marking a unique instance of universal health care in the United States. The figure of $50,000-100,000, however, is based on a small study in the 1980s and is not reflective of the practice patterns and technology of dialysis in use today, and this study updates to that figure to $129,090 by using a simulation model and data from more than one million patients in the United States.

Renal dialysis is the main form of treatment for more than half a million patients suffering from end-stage renal disease in the United States. End-stage renal disease is one of the most significant sources of expenditures for Medicare and is currently accounting for more than $30 billion of Medicare's yearly spending.

Professor Lee of The Wharton School comments "The figure of $129,090 is obviously a population average, but the range is extremely wide because of idiosyncratic differences among patients. In using any threshold to determine coverage, some patients will inevitably be excluded. This prompted us to develop a percentile approach to setting the threshold. The use of percentiles focuses on the fraction of patients covered rather than the last one or two cases that are too cost-ineffective to cover."

Value in Health (ISSN 1098-3015) publishes papers, concepts, and ideas that advance the field of pharmacoeconomics and outcomes research and help health care leaders to make decisions that are solidly evidence-based. The journal is published bi-monthly and has a regular readership of over 3,000 clinicians, decision-makers, and researchers worldwide.

ISPOR is a nonprofit, international organization that strives to translate pharmacoeconomics and outcomes research into practice to ensure that society allocates scarce health care resources wisely, fairly, and efficiently.

Value in Health Volume 12 Issue 1 - January/February 2009
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http://www.ispor.org